NewsFlashEuro Dec phenol contract settled down 9% on benzene

LONDON (ICIS news)--The European phenol contract for December was settled down Euro86/tonne at Euro915-955/tonne on lower benzene contract prices, producers and consumers said on Friday.

The lower contract agreement, settled on a free delivered (FD) Northwest European (NWE) basis, reflected the drop in this month’s benzene contract price. The December benzene contracts were settled at Euro490/tonne free on board (FOB) NWE and Euro492/tonne FOB NWE, down Euro85-87/tonne from the previous month.

Most phenol producers and consumers agreed to apply the average of the two numbers, with some surprised by the size of the decrease.

Downstream bisphenol A (BPA) and caprolactam prices were also expected to fall in December. Weakness in the key BPA market has led to some phenol producers reducing operating rates to avoid oversupply.

Despite cutbacks, the acetone market remains weak with spot prices under continued downward pressure over the past month, market sources said. On Friday, prices were assessed at Euro670-710/tonne FD NWE, down Euro90/tonne from the start of November.

Slow demand and lower prices for deals among traders triggered the decreases, with some European producers following the drop in an effort to move volumes before the year end. Sellers said opportunities to export acetone from ?xml:namespace>Europe were not economically viable at present.